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Newell Rubbermaid Management Discusses Q4 2011 Results - Earnings Call Transcript

In Q4, all 3 operating groups grew reported and core sales. Tools, Hardware & Commercial Products had another strong quarter, with reported sales up 7.7% and core sales up 8.0%. Office Products delivered reported sales growth of 3.7%, with core sales up 3.8%. Home & Family delivered reported sales growth of 1.2%, with core sales up 0.9%. In Q4, 10 of our 13 global business units grew core sales, 4 of the 13 grew core sales greater than 5% and 3 grew core sales greater than 10%. Baby & Parenting delivered core sales growth of 4.5% in Q4 and close to 2% in the second half of 2011, as a result of very strong growth of Aprica in Asia and progress towards stabilizing Graco in North America.

While there's more work to be done here, this is a step in the right direction. In 2011, our top 14 brands delivered 4.9% reported growth, with the best absolute contributions coming from IRWIN, Lenox, Rubbermaid Commercial and Aprica. Together, these 4 brands grew reported sales over 11%. In the emerging markets, core sales grew over 10% in Q4, with double-digit core sales growth in most of the major emerging market countries. Our Q4 core sales growth was 2.5% in the developed world, with strong growth in Japan and solid results in North America, partially offset by a decline in Western Europe.

Our key growth initiatives are yielding the results we expect. Industrial Products & Services achieved their eighth consecutive quarter of double-digit core growth behind strengthened selling capabilities in the emerging markets and the successful launch of our Speed Slot Hole Saw. Parker Ingenuity has been successfully launched into 11 countries now, to positive critical acclaim and terrific sell-through, particularly in Asia and via e-tailers in North America.

IRWIN delivered strong growth as a result of our new GrooveLock Pliers and levels and measuring launches. Paper Mate InkJoy has been launched into virtually all countries where Paper Mate is sold, with the bulk of the marketing support still to come. Rubbermaid Medical increased revenues over 80%, as we continue to scale this brand. Sharpie and Paper Mate were successfully launched in Brazil and are making good early progress. And as mentioned, Aprica had a terrific second half in Asia, as virtually every new item we've launched exceeded expectations. Aprica Asia had Q4 core sales growth of over 20%. And Calphalon had an excellent year behind the expansion of kitchen electrics, the new bronze contemporary nonstick line and the distribution win at J.C. Penney.

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